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TRON’s Justin Sun’s Reassures Crypto Community That Huobi Exchange Is Solvent

In a recent development, Justin Sun, founder of popular blockchain Tron, has urged people to disregard speculations that the crypto exchange Huobi is facing severe challenges following news of the alleged detention of some of the platform’s officials. 

The rumors appear to be a major contributing factor to why the firm experienced multi-million withdrawals during the weekend, while Tron’s Total Value Locked (TVL) has fallen below $2.5 billion. 

Trouble In Paradise?

Over the past weekend, cryptocurrency exchange Huobi experienced massive outflows worth about $64 million amid reports that Chinese authorities were investigating its executives and the likelihood of insolvency.

There were speculations that the platform’s leaders were arrested on the 5th of August in China. According to popular Chinese reporter Colin Wu, the arrest was due to Huobi’s involvement with gambling websites. One top official of the exchange also recently left the company, though it remains unclear if that was connected to the ongoing investigations by Chinese authorities.

A third of the $64 million is believed to be made up of Bitcoin (BTC), while Tron’s native token (TRX) and Huobi Token (HT) follow respectively at 26.5% and 20.3%. The rumors were so rife that the withdrawals triggered serious volatility in HT’s price and the token fluctuated during the weekend before settling at its present level of about $2.66.

Furthermore, there are also rumors that the exchange is undergoing protracted financial challenges. According to Adam Cochran, an angel investor and fintech executive, there are some discrepancies in the platform’s Tether (USDT) holding. 

Based on on-chain data, Huobi held less than $90 million of assets on the 5th of August. However, their recent “Merkle Tree Audit” claims they hold $630 million in USDT. 

Cochran believes this means that Huobi might be insolvent, implying the platform may not have sufficient funds to meet its obligations.

Huobi Token (HT) price chart from Tradingview.com

Huobi Reacts To Speculations

In response to the speculations, Justin Sun, who serves as an Advisor to the exchange, recently took to his Twitter account to offer some clarifications. In a series of tweets, he asked users to “ignore FUD, keep! #TRON  and Huobi will thrive through continuous development. Trust in our vision and community efforts for a stronger future. Perseverance guarantees success!”

Many users simply responded by posting the figure “4” below his tweet. The figure, which was popularized in the crypto space by Changpeng ‘CZ’ Zhao, Binance CEO, simply means “Ignore FUD, fake news, attacks, etc.” 

This is not the first time Sun and his team are facing serious troubles. In the past, there have been rumors of financial troubles at the exchange. However, it remains to be seen what the likely fallout would be in the most recent event.

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Justin Sun Will Now Publicly Trade Meme Coins Like PEPE, Best Time To Copy Trade Him?

Justin Sun, the vocal crypto supporter and co-founder of Tron and chief executive officer (CEO) of BitTorrent, says he will begin actively trading meme coins like PEPE. 

Justin Sun Eying Meme Coins

In a tweet on May 11, Sun, known for being a crypto whale, actively holding and transferring colossal sums of coins in the past, said he would begin actively trading meme coins and promising projects straight from his public cryptocurrency address. 

However, as a disclaimer, all profits will be donated to charity. 

He also added that though he might decide to buy certain coins and get exposure to a promising meme coin project, the said coin or project, regardless of its potential, may not be listed on Huobi or Poloniex. These are some of the early and most liquid cryptocurrency exchanges listing hundreds of tokens that Sun occupies an influential executive seat.

It is still unclear which project Sun has an eye on. At the same time, it could not be determined which of his crypto addresses the co-founder will use when trading meme coins. 

Although Sun might be the co-founder of Tron, he has not shied from engaging in other projects deployed on public networks like Ethereum and others.

Tron Co-founder Warned By Binance

Following a warning from Changpeng Zhao, the CEO of Binance, the world’s largest exchange by client count and trading volumes, Sun reversed a $56 million transfer he had made in early May. There were concerns that Sun was planning a token grab of SUI, the native currency of the Sui Network. 

WhaleAlert flagged Sun’s bulk $56 million transfer in TUSD. Before Zhao said, Binance would take action if he block-bought SUI from the Binance Launchpool. The exchange clarified that it wanted a fair airdrop to include active retailers and not “just a few crypto whales.” 

Through the Launchpool, users can stake their crypto assets like SUI, providing liquidity, before receiving staking rewards. 

SUI Price On May 11| Source: SUIUSDT On Binance, TradingView

Sun later apologized for the huge transfer, saying it was in error. The real intention, he clarified, was in the market-making of TUSD, a stablecoin. The Tron founder said:

Regrettably, some of our team members were not fully aware of the intended purpose for these funds and inadvertently used a portion of them to participate in exchange campaigns. Upon realizing this error, we immediately contacted the exchange team and arranged for a full refund of the funds.

It is not immediately clear how Sun will proceed in trading and how the community will react to his purchases once he starts picking out worthy meme coin projects. Even so, what’s clear is that his addresses, like those of other influential crypto founders like Ethereum’s co-founder Vitalik Buterin, will be actively tracked and copied.